DP5927 The Aggregate Labour Market Effects of the Swedish Knowledge Lift Program

Author(s): James Albrecht , Gerard J van den Berg , Susan Vroman

Publication Date: November 2006

Keyword(s): job search , returns to education , program evaluation , wages , unemployment , Swedish labour market , calibration

JEL(s): C31 , D83 , J21 , J24 , J31 , J64

Programme Areas: Labour Economics

Link to this Page: www.cepr.org/pubs/dps/DP5927.asp.asp

The Swedish adult education program known as the Knowledge Lift (1997--2002) was unprecedented in its size and scope, aiming to raise the skill level of large numbers of low-skill workers. This paper evaluates the potential effects of this program on aggregate labour market outcomes. This is done by calibrating an equilibrium search model with heterogeneous worker skills using pre-program data and then forecasting the program impacts. We compare the forecasts to observed aggregate labour market outcomes after termination of the program.